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What video games can teach us about global economies

What video games can teach us about global economies

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Video games can already offer a clear look at some fairly complex human behaviors as they're expressed in virtual contexts. (Any fan of The Sims can attest to this). However, economists like Yanis Varoufakis are now looking to games like Half Life and Portal as new ways to understand social economics. Varoufakis, who teaches at the University of Athens and holds a position at the University of Texas at Austin, was brought on by Valve to be the company's in-house economist. Between 2012 and mid-2013, he looked to games as ways to upend and even replace the models that economists use to understand capital and how communities make use of it. As he told Reason Magazine, he came away discovering something startling:

Let me put it very brutally and very bluntly: Our best economic models-from the Federal Reserve or the U.S. Treasury or the International Monetary Fund or the Organization for Economic Development-are really not worth the trouble of putting together. Because they are presuming a kind of equilibrium stability and convergence toward equilibrium, because it makes our models look better. It is not something that is replicated in the real world.

Read the whole interview at Reason. Below is a talk at Valve about in-game economies.